Do You Want Help Preparing Your Taxes But Don’t Know Who To Turn To?
November 17, 2017
It’s that time of year again, and as a small business owner you’re thinking about preparing your taxes ready to be filed. Penalties for errors or late filing can be costly, especially for smaller companies, and so getting ahead and preparing your taxes is strongly advised. But what if you don’t have the time to do this yourself, or don’t have the necessary skills and knowledge to prepare your taxes without fear of making a mistake? If this is the case, then you should hire a qualified tax preparer.
Who can best help me to prepare my taxes?
Anyone can help you to prepare your tax return, and they certainly don’t need to be qualified to do so, but rest assured, it certainly helps.
If a friend or relative is being paid to help you prepare your taxes, they must have a 'Preparer Tax ID Number' or PTIN that can only be provided for them by the Inland Revenue Service or IRS.
However, it’s always advisable to seek help with preparing your taxes, from a person or company who are fully qualified and who have extensive knowledge and experience in tax preparation, and this is the only way to be confident that you’ll avoid costly errors and penalties.
What roles, do qualified and registered tax preparation specialists, fulfil?
In fact, tax preparation specialists are required by law to fulfil several different roles, each of which are listed below:
- Tax advisor –in this role, the preparer can help you to make informed tax planning decisions
- Tax preparer – this should be their primary role, of course, and they must sign the return so that it’s clear who completed the work
- IRS representation – should you be audited by the IRS, it’s best if your tax preparer can represent you before the IRS and Tax Court, so before hiring one, check whether they will be able to do this for you
How many types of professional tax preparers are there?
There are 3 types of tax preparers who can help you in a professional capacity, and they are as follows:
- Accountant – an accountant may be able to help you prepare tax returns, and sign them, but they will not be able to represent you before the IRS in the event of an audit. Simply having the title of an accountant, doesn’t also mean that they are certified or skilled enough to help you.
- Enrolled Agent – these can prepare tax returns and help with communications with the IRS, but they are not able to represent you in court should it be required.
- CPA – CPA’s are accounting professionals who have passed a qualifying exam to become licensed to give accounting and tax services to individuals and businesses. Since they can specialize in many areas, it’s best to find a CPA who deals only with tax preparation and giving tax advice.
Important information about tax preparers:
As the owner of a business, it is you and you alone who must take sole responsibility for the accuracy and completeness of your tax return. While you may not be able to check your return before it is submitted and know if a mistake has been made, this is usually avoided if you employ the services of a qualified and experienced tax preparer.
Always check the credentials of any tax preparer that you are looking to hire; ask for their PTIN and any relevant licenses, such as a CPA license, and ensure that they are current.